Which of the Following Controls Can Be Used to Prevent

question 30

Multiple Choice

Which of the following controls can be used to prevent or detect personal purchases on company credit cards?

• A) Having credit card statements sent directly to someone with signature authority on the account for review and payment
• B) Requiring employees to receive store credits rather than cash when returning items they purchased with the company's credit card
• C) Monitoring credit card expenses for unexplained increases in purchasing levels
• D) All of the above

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Definitions:

Asset Valuation

The process of determining the fair market value of assets, which can include both tangible assets like property and intangible assets like patents.

Current Ratio

A liquidity ratio measuring a company's ability to pay short-term obligations, calculated as current assets divided by current liabilities.

Short-Term Notes Payable

Liabilities representing amounts borrowed that are expected to be repaid within one year or one operating cycle, whichever is longer.

Accruals

Accounting method where revenue and expenses are recorded when earned or incurred, regardless of when the cash transaction occurs.